Karoon Says Peru Assets Drawing Interest From Potential Partners

Feb. 20 (Bloomberg) -- Karoon Gas Australia Ltd., an
explorer with oil blocks in South America, said more than 10
companies are interested in becoming a partner to help develop
its assets in Peru.

The company plans to offer about 30 percent of the Peru
prospects and is starting to give potential bidders access to
the data, Executive Chairman Robert Hosking said yesterday in an
interview in Melbourne. Karoon also hired Rob Singh from
Schlumberger Ltd. unit IndigoPool, an adviser to oil and gas
companies, to help with planned transactions to bring in
partners in South America and Western Australia, Hosking said.

“We’ve got a lot of interest,” Hosking said, without
naming any companies. “There’s a healthy appetite.”

Mt Martha, Victoria-based Karoon is developing oil blocks
off Peru and Brazil after scrapping a proposed initial public
offering of its South American business in November 2010.
Colombia’s Pacific Rubiales Energy Corp. agreed in September to
acquire a 35 percent stake in Karoon’s exploration assets in
Brazil’s Santos Basin.

Karoon shares, which have risen 35 percent in Sydney this
year, gained 1.3 percent today to A$7.15 at the close in Sydney,
valuing the company at A$1.58 billion ($1.64 billion).
Australia’s benchmark S&P/ASX 200 Index climbed 0.3 percent.

While Pacific Rubiales may be interested in a Peru
partnership, Karoon’s holdings in that country probably won’t
generate as much interest as the assets in Brazil, said Kirit
Hira, a Sydney-based analyst at Macquarie Group Ltd., who values
Karoon at A$10 a share and the Peru assets at about A$1 a share.

“The Santos Basin is one of the hottest places in the
industry,” Hira said by phone today.

The explorer plans to begin drilling in Peru at the end of
2013 after finding a partner to help fund the project, Chief
Financial Officer Scott Hosking said in January. The holdings in
Peru’s Tumbes Basin may hold as much as 1.92 billion barrels of
oil, according to Karoon’s estimates in December.